2020 annual results
- Altarea absorbs the shock of the health crisis
- Stable revenue and sharp decrease in debt
- Urban transformation: a vast and growing market
- A multi-product and multi-brand model with unimpaired potential
"Altarea has successfully coped with the shock of the health crisis, as shown by the strength of its financial position, and is now more confident than ever in its long-term outlooks.
Faced with a crisis of unprecedented magnitude, our teams found the right solution for each situation. In Residential, their commitment made it possible to redirect our offer towards institutional investors and to maintain our growth path. In Retail, we supported our tenants in a partnership approach to preserve and reinforce the future. Lastly, in Business property, activity remained buoyant, although there was no way to avoid the postponement of several major deliveries to 2021. FFO remains in line with the guidance given last July, but nonetheless fell for the first time in more than ten years due in particular to delays in Business property projects and the increase in taxes.
At the same time, Altarea succeeded in strengthening its financial structure. Our Group’s liquidity, already high before the crisis, reached €3.4 billion. Our financial leverage is preserved with a Loan to Value ratio of 33.0%, as the sharp drop in debt, particularly in Property Development, offsets a significant correction in the value of Retail assets without deteriorating this ratio.
Altarea is confident in its short- and long-term prospects.
In the short term, FFO is expected to resume its growth path in 2021, if the health situation does not significantly worsen. The extent of this growth will nevertheless depend on changes in the health situation. The first half of the year will still be heavily affected by the COVID restrictions, but the second half should benefit from on the deferred deliveries of Business Property projects. This confidence is reflected in the proposal for a dividend increase of +5.6% to €9.50 per share at the next General Shareholders' Meeting. This proposal will be accompanied by an option to take part-payment in shares, as we have offered seven times in the last ten years. The main shareholders of the Group as well as the senior executives of Altarea, together representing nearly 80% of the share capital, have already announced their intention to subscribe to this option.
Beyond 2021, Altarea intends to resume its forward movement. As a leader in the urban transformation market, our long-term prospects are stronger than ever. The health crisis has accelerated the obsolescence of urban real estate infrastructure and accentuated the urgency of their reconversion. All the Group's projects offer exemplary solutions in terms of sustainability and the fight against climate change. In Residential, Altarea intends to continue building market share and is targeting annual sales of 18,000 units across its brand portfolio. Sales to individuals should increase while maintaining a high level of sales to institutional customers. In Retail and Business property, we will continue to make targeted investments that create value, such as the Paris Austerlitz station. Lastly, Altarea has the financial and managerial capacity to consider all kinds of opportunities which will enable it to further expand its range of skills.
We look to the future with confidence because our market is vast and growing."
Alain Taravella, Chairman and Founder of Altarea